Rogers’ new CEO gets an early start after deal
TELUS AGREEMENT
TORONTO• Rogers Communications Inc.’ s new CEO will start months earlier than expected after the Toronto- based communications giant convinced its Vancouver-based competitor Telus Corp. to release him from a non- compete agreement.
Former Telus CEO Joe Natale will join Rogers as president and CEO on April 19, the day of the company’s annual general meeting where he will also be appointed to the board, Rogers announced Thursday. He was originally scheduled to start in July once his non-competition contract with Telus expired, but Rogers said it has reached a confidential agreement with Telus so he can begin about 10 weeks early.
Rogers reached out to Telus at least three times last fall in attempts to release Natale from the agreement before the October announcement that he had been tapped to replace Guy Laurence, who was ousted after three years due to conflict with the Rogers family, the controlling shareholder.
Telus wasn’t adverse to negotiating with Rogers, but had no incentive to be proactive, sources told the Financial Post at the time. The final terms of their agreement were not disclosed.
Natale was named CEO of Telus in May 2014 after working at the telecom since 2003. He held the position until August 2015 when former CEO Darren Entwistle returned to the job, a leadership change that secured Natale a $6.2-million “transition payment,” according to company documents.
Natale was credited with vastly improving Telus’ customer service, a challenge Rogers has been trying to tackle for years with consumer- friendly initiatives like lower roaming fees and data management tools.
Natale’s early start is good news for Rogers, Macquarie Research analyst Greg MacDonald said in an email. It gives the stock better potential to return to dividend growth in early 2018, he noted.
In January, executives told analysts it would be impractical to make a long- term decision on dividends in the midst of a CEO transition.
In a statement, Rogers deputy chairman Edward Rogers said he was thrilled to welcome Natale and thanked interim CEO Alan Horn for leading the company since October.
“Alan, the leadership team and Joe will work together to ensure a seamless transition. When Joe arrives he will build on the momentum that’s been established bringing an even greater focus on the customer,” Rogers said.
Horn shuffled the executive team in advance of Natale’s arrival, “we assume with Mr. Natale’s blessing,” Barclays analyst Phillip Huang wrote in a note to clients. Two members of the senior management team have left in the past couple months, and the reporting structure changed for another.